ECONOMY

Small firms to get VAT payment exemption

The Finance Ministry is promoting a plan for the exemption of small and medium-sized enterprises and self-employed professionals with annual gross revenues below 20,000-25,000 euros from having to pay value-added tax.

The regulation, which would raise the exemption cap from 5,000 euros per year, will be included in one of the bills to be submitted in Parliament after July 15, although some ministry officials have expressed concerns about the final threshold level, saying 25,000 euros is too high.

This regulation in effect incorporates a proposal by the International Monetary Fund, which had asked for the exemption of small enterprises from VAT payment. Some 42 percent of those taxed in the VAT system are small enterprises that end up getting more in tax rebates than they pay in VAT.

Ministry sources say that the new income tax code will be put up for public consultation next week, followed in two weeks’ time by the new tax procedure code.